Finally, we have an Apple branded Hi-Fi stereo system.
Here are the specs: It will have an integrated power supply for the traditional wall outlet power or it can run off six D-size batteries for "several hours outside" of playtime. It uses two 80mm mid-range drivers in sealed acoustic suspension. It uses a 130mm dual voice coil woofer with a ported bass reflex design. And best of all, it has a universal dock for iPod goodness, including an auxiliary input. It is built in a sealed resin enclosure that doesn't vibrate.
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There will be an iPod software update to put a speaker menu item in the main menu. And it can all be controlled with the Apple remote.